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London keeps rest of the market going
The latest survey of the housing market by Hometrack reveals a national market registering a slowdown in both demand and sales agreed while supply coming onto the market continues to rise.
Overall house prices moved higher by 0.2 per cent over the month with a 0.6 per cent increase in London boosting the headline rate of growth.
Prices edged higher in the South East (0.1 per cent) and East Anglia (0.1 per cent) while in all other regions prices were either static or moved lower.
“The volume of new buyers registering with agents grew by 0.4 per cent in May, down from increases of 2.1 per cent in April and 4.4 per cent in March,” says Richard Donnell Director of Research at Hometrack. “The growth in the number of sales being agreed slowed significantly in May, rising 3.8 per cent compared to increases of 10.1 per cent and 13.2 per cent over the previous two months. These trends mirror the pattern seen in previous years with overall levels of demand and sales agreed slowing after Easter.
“Increased mortgage rates and mounting concerns over the impact of the Eurozone on the UK’s economic growth and employment are likely to keep demand and prices in check as we move into summer.”
According to the report, the improvement in market conditions over recent months has resulted in rising levels of supply coming to the market as sellers look to take advantage of strengthening market indicators.
The time taken to sell currently stands at 9.3 weeks and the proportion of asking price achieved has increased to 93.2 per cent (a level last reached in September 2010).
“That said these improvements are concentrated in Southern England and are not representative of a general trend across the country as a whole,” explains Donnell. “The supply of homes for sale grew by 2.2 per cent in May and has grown by 10.6 per cent over the last three months.”